Adrian Kerley leaves Australia's CSC for IFM

It marks a return to the GP side for Kerley, who spent about six years with CHAMP Ventures before joining CSC in 2016. He will be reunited with Stuart Wardman-Browne, the global head of private equity at IFM and previously co-head of CHAMP Ventures. Wardman-Browne moved to IFM in 2016 as an executive director and assumed leadership of the PE business from Steve Lipchin last year.

IFM, which is owned by 27 Australian superannuation fund shareholders, had A$113 billion ($81 billion) under management across debt, listed equities, infrastructure, and private equity as of September 2018. With A$1.8 billion in assets, private equity is very much the poor relation, but it has undergone a relatively rapid evolution in recent years.

Having raised and deployed around A$3.5 billion across seven fund-of-funds programs between 1995 and 2013, IFM decided to pursue a direct investment approach around 2012. It sought to develop an approach that addressed several issues facing Australian LPs: an inability to back middle-market managers due to increases in minimum check size; dissatisfaction with the cost of participation in PE and the lack of transparency in closed-end funds; and discomfort at being unable to influence exit timing.

The solution was single-client mandates that enable customization and deal pipeline visibility, have built-in liquidity features so that LPs can move or potentially exit investments, and charge less than the traditional 2% management fee and 20% carried interest. The team usually deploys A$50-150 million in equity per deal but can go up to A$300 million.

CSC manages superannuation funds specifically designed for Australian government and defense force employees. The five regulated schemes – out of 11 in total – for which it is responsible had a combined A$42.2 billion in assets as of June 2018. The Public Sector Superannuation Scheme (PSS) accounted for A$20.4 billion and had a 14.9% PE allocation.

CSC had 28 private capital GP relationships across all its schemes. They included nine Asia-headquartered managers: Affinity Equity Partners, CITIC Capital, FountainVest Partners, J-Star, Orchid Asia, and True North, as well as Australia-based Anchorage Capital Partners, Crescent Capital Partners, Quadrant Private Equity, and ROC Capital.

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• Topics
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• Commonwealth Superannuation Corporation (CSC)
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